Challenging period for PharmaZen; future bright

September 16, 2013

Challenging period for PharmaZen; future bright

In a six-month period that wasn’t without challenges, biotechnology company PharmaZen posted a $223,000 profit after interest and depreciation. Turnover was $3.198 million compared with $3.470 million last year.

While down on 2012 figure of $275,000, PharmaZen Chief Executive, Craig McIntosh, said that the result was a positive one given the challenges faced.

“We had a number of issues conspiring in the first six months of the year, the dollar being a continual challenge while the drought impacted raw material supply significantly. We also saw the calcium market hit hard by research published linking intake to heart attacks.”

McIntosh sees this drop in calcium sales as a short term issue which will eventually open up significant growth opportunities for the company.

“While this is causing some short term pain, it is something we have seen coming for the last two to three years and have been investing heavily in product development to find a solution.

“The critical factor in the link between calcium and heart attacks is the spiking calcium serum levels caused by rapid release calcium products.

“We have developed a slow release product, trademarked StimuCal, which delivers the calcium without the dangerous spikes in calcium serum levels all of which has been validated in a clinical trial at Auckland University School of Medicine,” he said.

The preliminary results of this trial were presented at the International Bone and Mineral Society meeting this year and with the patent application filed the company can now start to actively market the product.

PharmaZen has partners in place for Australasia, South East Asia and North America with discussions taking place for other markets.

“Product registration issues vary between regions but we have solid orders coming in with product starting to be shipped in the fourth quarter this year and on the shelves in Australasia and the United States in February, 2014.

“We were probably a little naive in terms of the time and cost it takes to get a product from concept through development, clinical trials, and the patent process but now we are finally seeing the orders coming in for StimuCal it is exciting – mixed with an element of relief,” he said.

The company has just completed a $2million site expansion which has seen a new factory built which will accommodate additional capacity.

“We have purchased additional drying, digest and blending equipment that allows us to scale up StimuCal production as demand increases and now have the ability to double current capacity.

“We expect our second half performance to be stronger than the first six months with potential upside depending on how rapidly product roll out occurs,” he said.

Background: PharmaZen’s trading division, Waitaki Biosciences, manufactures a collection of powder products extracted from animal and marine sources. The range includes green-lipped mussel, shark cartilage, natural calcium and Chondroitin Sulphate. The products are used by other companies as a base for health products, mainly in the areas of bone health, joint health, immune and digestive support as well as hair care and cosmetic applications.

ENDS

© Scoop Media